Ford Motor Co is shuttering its two plants in India, a decision that will leave thousands of Indians without jobs.
The company has been forced to take the decision due to huge accumulated losses and lack of growth in the country.
Ford will end manufacturing operations in Sanand, Gujarat, by the fourth quarter of 2021, and vehicle and engine manufacturing in Chennai by the second quarter of 2022, the company said on Thursday.
This is the second major exit of local manufacturing operations in India by a global carmaker. General Motors, which entered India just a few years before Ford, quit in 2017.
Following accumulated operating losses of more than $2 billion over the past 10 years and a $0.8 billion non-operating write-down of assets in 2019, Ford has been forced to restructure to create a sustainably profitable business in India, the company said.
Jim Farley, CEO and president of Ford Motor Company, said: “As part of our Ford+ plan, we are taking difficult but necessary actions to deliver a sustainably profitable business longer-term and allocate our capital to grow and create value in the right areas. Despite investing significantly in India, Ford has accumulated more than $2 billion of operating losses over the past 10 years, and demand for new vehicles has been much weaker than forecast.”